October 9th, 2009 9:29 PM by Lehel S.
Friday's bond market has opened down sharply as yesterday's afternoon selling continues into this morning. The stock markets are showing gains with the Dow up 43 points and the Nasdaq up 11 points. The bond market is currently down 30/32, which with yesterday's afternoon weakness will likely push this morning's mortgage rates higher by approximately .500 - .625 of a discount point over yesterday's morning rates.
Today's only economic data was August's Goods and Services Trade Balance report. It revealed a $30.7 billion trade deficit, exceeding forecasts. However, this news is relatively inconsequential to the markets and has had little impact on today's trading or mortgage rates.
Yesterday's 30-year Bond sale did not go nearly as well as Wednesday's 10-year auction. This led to afternoon selling in bonds yesterday that created upward revisions to mortgage rates. This weakness did not come as a surprise, so hopefully our loyal followers headed the conservative approach towards mortgage rates. Unfortunately, today may not be the end of the selling or upward move in rates.
Next week brings us the release of a couple of very important economic reports and the release of the minutes from the last FOMC meeting. The bond market will be closed Monday in observance of the Columbus Day holiday, but the stock markets will be open for trading. There is no early close for the bond market today.
The week's first relevant economic report does not come until Wednesday morning. Look for details on next week's data and relevant events in Sunday's weekly preview.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Lock if my closing was taking place over 60 days from now... This is only my opinion of what I wou ld do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.
©Mortgage Commentary 2009